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Glorious Gadgets is a retailer of astronomy equipment. They purchase equipment from a supplier and then sell it to customers
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Answer #1

in the function given above when x changes there will be no change in the constant (13500) only the variable parts in the equation will change i.e, 3x and 40500/x hence the total cost will be lowest at the point where 3x =40500/x is lowest

taxing trail and error method

  • if x =1 the total of 3x+40500/x =3+40500=40503
  • if x =13500 the total of 3x+40500/x = 40500+3=40503

think of a curved diagram it is the point where it is a high as the first point hence the lowest cost will be inside these two points hence if 3x =40500/x it will be the lowest possible outcome

by trial and error if x = 116 then

C(x)= 348 +349+13500 =14197

the lot size should 116 per order

the minimum inventory cost will be 14197

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